Florida rents plummet amid surplus, bucking national trend

by | Jul 15, 2024

Florida’s largest cities have seen significant declines in rent prices, diverging from the national trend of rising rents, primarily due to an oversupply of rental units from increased apartment construction during the pandemic.

Florida’s rental market has recorded a sharp decline in rent prices across its largest cities, diverging from the national trend of rising rents, with falling prices in Jacksonville, Tampa, Orlando, and Miami.

According to a real estate report published by Redfin, Jacksonville saw the most significant drop, with median asking rents decreasing by 12.4 percent year-over-year in June, marking the largest decline on record for the city. Tampa saw a 6 percent drop, Orlando 4.8 percent, and Miami 3.8 percent. In contrast, the national median asking rent rose 0.7 percent to $1,654, the highest level since October 2022.

These declines in Florida are largely attributed within the report to the surge in apartment construction during the pandemic. Following a migration surge, Florida ramped up building to meet increased demand, resulting in a surplus of rental units. Jacksonville ranked third in the nation for multifamily building permits per 10,000 people from 2021 to 2023. Despite a slowdown in new projects, the completion of many existing ones has kept supply high.

The increased supply is driving competition among landlords, leading to lower rents and more concessions for tenants, such as free parking or discounted rent. However, landlords in Florida face rising home insurance costs, which could lead to higher rents in the future.

“It’s a good time to hunt for bargains if you’re a renter in Florida,” said Redfin Senior Economist Sheharyar Bokhari. “With so much supply on the market, renters may be able to get concessions like free parking or discounted rent. But renters in Florida should be aware that landlords are grappling with surging home insurance costs, and they may ultimately ask tenants to foot the bill via higher rents.”

Redfin economists further contend that the rent reductions can also be viewed as a correction from the inflated prices during the pandemic. The real estate firm provided data reflecting that Tampa saw a 37.8 percent surge in rents in 2022, more than double the national average, though as the market stabilizes, rents are adjusting to more realistic levels.

Florida’s situation contrasts with some other regions nationwide. In Virginia Beach, median asking rents increased by 12.9 percent, and in Cincinnati, they rose by 12.2 percent — two metro regions that have not seen as much new apartment construction as Florida, contributing to tighter supply and higher rents.


Leave a comment

%d bloggers like this: